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Coca-Cola Enterprises Inc (NYSE:CCE)
Beneish M-Score
-2.82 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Coca-Cola Enterprises Inc has a M-score of -2.82 suggests that the company is not a manipulator.

CCE' s Beneish M-Score Range Over the Past 10 Years
Min: -4.57   Max: -2.21
Current: -2.82

-4.57
-2.21

During the past 13 years, the highest Beneish M-Score of Coca-Cola Enterprises Inc was -2.21. The lowest was -4.57. And the median was -2.58.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Coca-Cola Enterprises Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.023+0.528 * 0.9814+0.404 * 1.0275+0.892 * 0.8484+0.115 * 1.0267
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0279+4.679 * -0.0448-0.327 * 1.0535
=-2.82

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $1,314 Mil.
Revenue was 1630 + 1822 + 1928 + 1631 = $7,011 Mil.
Gross Profit was 600 + 697 + 705 + 568 = $2,570 Mil.
Total Current Assets was $2,046 Mil.
Total Assets was $7,611 Mil.
Property, Plant and Equipment(Net PPE) was $1,920 Mil.
Depreciation, Depletion and Amortization(DDA) was $274 Mil.
Selling, General & Admin. Expense(SGA) was $1,704 Mil.
Total Current Liabilities was $2,157 Mil.
Long-Term Debt was $3,407 Mil.
Net Income was 156 + 168 + 176 + 96 = $596 Mil.
Non Operating Income was -1 + -4 + -1 + 2 = $-4 Mil.
Cash Flow from Operations was 152 + 428 + 203 + 158 = $941 Mil.
Accounts Receivable was $1,514 Mil.
Revenue was 1925 + 2136 + 2333 + 1870 = $8,264 Mil.
Gross Profit was 669 + 808 + 846 + 650 = $2,973 Mil.
Total Current Assets was $2,460 Mil.
Total Assets was $8,543 Mil.
Property, Plant and Equipment(Net PPE) was $2,101 Mil.
Depreciation, Depletion and Amortization(DDA) was $309 Mil.
Selling, General & Admin. Expense(SGA) was $1,954 Mil.
Total Current Liabilities was $2,608 Mil.
Long-Term Debt was $3,320 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(1314 / 7011) / (1514 / 8264)
=0.18741977 / 0.18320426
=1.023

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(697 / 8264) / (600 / 7011)
=0.35975315 / 0.36656682
=0.9814

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (2046 + 1920) / 7611) / (1 - (2460 + 2101) / 8543)
=0.4789121 / 0.46611261
=1.0275

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=7011 / 8264
=0.8484

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(309 / (309 + 2101)) / (274 / (274 + 1920))
=0.12821577 / 0.12488605
=1.0267

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(1704 / 7011) / (1954 / 8264)
=0.24304664 / 0.23644724
=1.0279

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((3407 + 2157) / 7611) / ((3320 + 2608) / 8543)
=0.73104717 / 0.69390144
=1.0535

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(596 - -4 - 941) / 7611
=-0.0448

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Coca-Cola Enterprises Inc has a M-score of -2.82 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Coca-Cola Enterprises Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.09721.00390.99952.23270.83770.84581.06091.03860.99311.023
GMI 1.02151.03561.033410.99871.00991.01681.03210.96880.9814
AQI 0.90651.00270.55341.53261.030.95251.0131.03860.96431.0275
SGI 1.05661.05721.04160.29881.03021.23380.97321.01861.00630.8484
DEPI 1.0460.96310.94661.11221.2180.84460.9981.08930.90271.0267
SGAI 0.98720.96370.99060.79641.01380.96921.01470.96980.99681.0279
LVGI 1.09610.94341.48960.38521.55371.12611.06861.09211.11631.0535
TATA -0.1174-0.0392-0.3847-0.0321-0.0233-0.0121-0.0287-0.0168-0.0365-0.0448
M-score -2.94-2.57-4.57-1.66-2.86-2.54-2.59-2.49-2.73-2.82

Coca-Cola Enterprises Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.11581.03861.0421.22961.03070.99310.87160.84570.86121.023
GMI 1.03161.03211.02341.00010.98010.96880.97050.9790.98950.9814
AQI 1.01211.03860.99340.96220.99950.96430.95650.98231.03091.0275
SGI 1.00711.01861.02341.05221.0341.00630.97490.90620.87280.8484
DEPI 1.07941.08931.10661.10250.9720.90270.86040.90740.98861.0267
SGAI 1.01440.96980.91930.93890.94870.99681.029611.02831.0279
LVGI 1.13351.09211.0831.09211.06951.11631.14081.10241.07871.0535
TATA -0.0232-0.0168-0.0165-0.0157-0.0149-0.0365-0.0519-0.0577-0.0771-0.0448
M-score -2.49-2.49-2.49-2.32-2.52-2.73-2.96-3.04-3.11-2.82
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